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Jordan Company makes three products in its factory: plastic cups, plastic tablecloths, and plastic bottles. The expected overhead costs for the next fiscal year
Jordan Company makes three products in its factory: plastic cups, plastic tablecloths, and plastic bottles. The expected overhead costs for the next fiscal year include the following: Factory manager's salary $219,400 Factory utility cost 72,000 Factory supplies Total overhead costs 27,000 $318,400 Jordan uses machine hours as the cost driver to allocate overhead costs. Budgeted machine hours for the products are as follows: Cups Tablecloths Bottles Total machine hours 290 Hours 725 975 1,990 Required a. Allocate the budgeted overhead costs to the products. Answer is complete but not entirely correct. Product Allocation Rate Weight of Base Allocated Cost Cups $ 165 x 290 $ 47,850 Tablecloths 165 x 7256 119,625 Bottles Total 165 xx 975 160,875 $ 328,350
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